Payroll Setup & Processing

What a compliant payroll involves

Payroll is where employment law, tax law and social-security law meet every month. A compliant setup has four layers: a salary structure that is lawful and tax-efficient, correct statutory deductions (PF, ESI and TDS), on-time deposits and returns for each of them, and clean documentation — payslips, registers and employee declarations. Get the structure right at the start and every subsequent month is routine; get it wrong and every month compounds the error.

PF, ESI and professional tax — what applies to you

Provident Fund applies once an establishment has 20 or more employees, with employer and employee each contributing 12% of basic wages; smaller employers can register voluntarily. ESI applies at 10 or more employees and covers staff earning up to ₹21,000 a month, giving them medical and cash benefits through ESIC.

Professional tax is a state levy and depends on where your employees work. Rajasthan does not levy it, so a Jaipur-only team has nothing to deduct — but employees based in states that do charge it must have it deducted at that state's slab.

TDS on salaries under section 192

Unlike most TDS, salary TDS is not a flat rate. Section 192 requires you to estimate each employee's annual taxable income — factoring in their choice of tax regime, declared investments and any other income they report — and deduct proportionate tax every month. Declarations are collected at the start of the year, proofs verified near the end, and Form 16 issued after year-close. Under- or over-deduction lands on the employer, so the computation deserves care.

The monthly cycle we run

• Attendance, leave and variable inputs collected; the payroll run processed and approved.
• Payslips issued to every employee showing earnings, deductions and net pay.
• PF, ESI and TDS deposited through their respective challans by the statutory due dates.
• Periodic returns filed — PF and ESI contribution returns and the quarterly TDS return for salaries (Form 24Q).
• Joiners, exits and full-and-final settlements processed, including leave encashment and gratuity where due.

The Labour Codes and the wage definition

The new Labour Codes standardise the definition of 'wages' so that allowances beyond a limit — broadly half of total remuneration — count back into wages. Because PF is computed on this base, structures that kept basic pay artificially low to shrink PF outgo will see contributions rise as the codes take effect. We design salary structures that already respect the new definition, so you are not forced into a disruptive rework mid-year.

Why set up payroll with TCC

We design the structure, complete the registrations, run the first payroll cycle and hand over — or keep running it monthly under a retainer, with WhatsApp confirmation for every deposit and filing. Fixed fee, no surprises for you or your team.